Embattled Kik shutting down app, laying off staff in Israel
Kik Interactive is kicking its messaging service to the curb. The move has been acknowledged by the company’s CEO, Ted Livingston, following the revelation that 70 employees at the platform’s Kin subsidiary had been let go. Kin is Kik’s cryptocurrency-focused arm and the reversals come on the heels of a lawsuit launched against the company by the U.S. Securities and Exchange Commission (SEC) this past June over what the commission said is a fraudulent initial coin offering (ICO).
In a blog post from September 23, Livingston stated, “After 18 months of working with the SEC the only choice they gave us was to either label Kin a security or fight them in court. Becoming a security would kill the usability of any cryptocurrency and set a dangerous precedent for the industry. So with the SEC working to characterize almost all cryptocurrencies as securities we made the decision to step forward and fight.”
However, his remarks are somewhat misguided and misdirected. While the SEC has not made a determination on whether or not certain digital currencies should be considered securities, it has already directly stated that others, including BTC and Ethereum (ETH) are definitively not securities. With that being the case, Kin had the perfect opportunity to move toward development that would fit the SEC’s guidelines.
Livingston went on to say that the Kik app will be shut down and that the platform’s working group will be reduced to just 19 people. He adds that, going forward, the company’s goal will be “converting Kin users into Kin buyers.” The executive says that the Kin Foundation will work to build a blockchain that can support a billion consumers “making a dozen transactions a day with sub 1 second confirmation times.”
He also leaves a thinly-veiled threat to the SEC, explaining, “But no matter what happens to Kik, Kin is here to stay. Kin operates on an open, decentralized infrastructure run by a dozen independent companies. Kin is a currency used by millions of people in dozens of independent apps. So while the SEC might be able to push us around, taking on the broader Kin Ecosystem will be a much bigger fight. And the Ecosystem is close to adding a lot more firepower.”
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